Nine big banks just spun out an independent carbon credit transaction network – the “SWIFT of carbon markets” – that aims to bring transparency, security, and certification to an opaque industry.
The lack of trust and verification around carbon markets has historically sidelined big banks from allowing their clients (and themselves) to use carbon credits to achieve ambitious ESG goals, so a group of banks is providing $45 million to build better infrastructure.
Banks need a better carbon credit transaction network, so they’re building it themselves.
BBVA, BNP Paribas, CIBC, Itaú Unibanco, National Australia Bank, NatWest, Standard Chartered, SMBC, and UBS formed and have now funded Carbonplace in order to make carbon markets more transparent, secure, and accessible.
The platform, which will launch publicly later this year, will connect buyers, sellers, registries, and exchanges with real-time information sharing, due diligence tools, and simplified reporting. The banks liken it to the ubiquitous bank-to-bank messaging platform SWIFT, and say that it’s already successfully piloted trades.
Carbonplace represents a major push by a handful of big banks to have a hand in the future of carbon credit trading and, ultimately, corporations’ transition to net zero greenhouse gas emissions, as sustainability continues to be a hot topic for regulators and corporate boards alike. Similarly, Bank of America and Goldman Sachs just joined a funding round for environmental markets platform Xpansiv.